Why is the optimal level of output for short-run profit maximization equal to that level where marginal revenue equals marginal cost? What is the mechanism that will push firms to this level of output?© BrainMass Inc. brainmass.com December 25, 2021, 12:03 am ad1c9bdddf
In order to maximize profit, a company will set production at the quantity where marginal revenue equals marginal cost. Marginal revenue is the additional revenue a firm will receive from producing one additional good. Marginal cost is the additional cost a firm will ...
The expert discusses why the optimal level of output for short-run profit maximization is equal to the level where marginal revenue equals marginal cost